No early Australian link to Californian carbon market

After announcing this week it will link its future carbon market to the EU’s, Australia may look to California next as a potential emissions-trading partner, but the US state may be less keen to cement a trans-continental link, analysts said.

On Tuesday, Australia announced it will link its emissions trading scheme to Europe’s in 2015, a move hailed as the first union of two major emission markets.

The country’s climate change minister, Greg Combet, told reporters that Australia will also pursue links with California, South Korea and New Zealand, which are developing their own carbon markets.

California officials have plans to travel to Australia in October to discuss potential market links with their counterparts, sources said, but some analysts and California officials said a tie-up between the two cap-and-trade systems would be a long way off.

California’s reluctance to accept credits from UN carbon offset projects, as evidenced in the state’s carbon market rules, signals that regulators are likely to be cautious when inking linkage deals with international partners.